So was this the “real estate deal” Fox News’ Sean Hannity alluded to, when it was revealed last week that he was Michael Cohen’s “third client”?
A new report in The Guardian notes that Hannity has investments in foreclosed homes, as well as low-income housing in seven states: North Carolina, Georgia, Alabama, Florida, Texas, Vermont, and New York.
Some of that investment help came with an assist from the Department of Housing and Urban Development – something not disclosed when Hannity had HUD Secretary Ben Carson on his program
The records link Hannity to a group of shell companies that spent at least $90m on more than 870 homes in seven states over the past decade. The properties range from luxurious mansions to rentals for low-income families. Hannity is the hidden owner behind some of the shell companies and his attorney did not dispute that he owns all of them.
Dozens of the properties were bought at a discount in 2013, after banks foreclosed on their previous owners for defaulting on mortgages. Before and after then, Hannity sharply criticised Barack Obama for the US foreclosure rate. In January 2016, Hannity said there were “millions more Americans suffering under this president” partly because of foreclosures.
There’s nothing wrong with seeing a deal and making an investment. There’s a lot wrong with slamming Obama for Americans suffering under foreclosure, then quietly swooping in to take advantage of that.
So what are the details about the properties?
Among the most valuable are two large apartment complexes in Georgia that Hannity bought in 2014 for $22.7m. The developments are in the cities of Perry and Brunswick, which have higher poverty rates and lower median incomes than the US averages. One- and two-bedroom units in Hannity’s apartment complexes are available to rent for $735 to $1,065 per month, according to brochures.
The Georgia purchases were funded with mortgages for $17.9m that Hannity obtained with help from Hud, which insured the loans under a program created as part of the National Housing Act. The loans, first guaranteed under the Obama administration, were recently increased by $5m with renewed support from Carson’s department.
Hannity has brought up the housing issue on his program before, falsely claiming that home ownership was at a 51-year low. He’s done this several times.
The Georgia mortgages supported by Hud were guaranteed as part of a program aimed at protecting investors such as Hannity who buy rental apartment buildings. The government promises to cover losses if borrowers default on their mortgages. Borrowers pay an insurance premium to Hud in return. Bigger loan guarantees are available if the building houses low-income families.
Paperwork relating to the agreements with Hud, which was filed to county authorities, named Hannity as the principal of the shell companies used to buy the apartment complexes and to borrow the funds. Hannity personally signed several of the documents. A Hud source said Hannity was identified in non-public filings as the 100% owner of the apartment complexes.
Late last month, Hannity’s mortgages were replaced with loans for $22.9m that were rewritten with Carson’s Hud and a new bank. There was no indication that Carson was personally involved in the process. Carson does, however, have the authority to allow Hannity from 2019 to convert the rental complexes into condominiums for sale, which could be lucrative for the television host.
The companies behind the purchases are limited liability (LLCs), and Hannity is listed as either the manager or principal of the companies.
Some of the homes listed were also noted to be lived in by some member of Hannity’s family, or Hannity, himself.
The list of properties bought by the Hannity-linked companies includes multimillion-dollar homes used by Hannity. It also features single-family units priced as low as $50,000 in relatively poor suburbs. In at least two cases, batches of homes were bought simultaneously at a discount, after they were repossessed by banks from their previous owners in foreclosure proceedings.
The entire portfolio connected to Hannity comprises at least 877 residential units, which were bought for a total of just under $89m. Another seven properties bought by the companies over recent years have subsequently been sold on for more than $4m, according to public records.
So he’s raging at President Obama, while benefitting off of those foreclosed homes, and he’s praising Carson on his show, without disclosing that Carson’s department had given an assist with purchasing some of those low income houses he looks to benefit financially from.
So is this illegal?
I don’t think so, but at the very least, it’s rather hypocritical, and you have to wonder if there’s anything else that the “third client” may be hiding.